When a new home buyer is looking to buy a home for the first time, it’s important to understand how the process goes and the difference between pre-approval and pre-qualification. When you are ready to buy your first home, visit Anew Lending for more information about home loans in Sacramento, CA. Our loan officers have years of experience and have been through different loan scenarios. You can trust Anew Lending to assist you with various home loan programs. Let’s learn more about a home mortgage, how it works, and how to choose the right home that’s a good investment.

What Is a Home Loan?

A home loan is a written agreement that allows a lender the right to take your home if you don’t repay the money they lend you. A home loan is given by a bank, a mortgage company, and other financial institutions in order to purchase a home. In a home loan, the owner of the property transfers the title to the lender. The mortgage payment is paid over a certain number of years based on how much you have borrowed. 

How It Works

The mortgage you get is a loan from a lender in order to finance a home purchase. When you take out a home loan, you agree and promise to pay the money you have borrowed at the agreed interest rate. In this case, the home is used as collateral, meaning if you break the promise to repay your mortgage, the bank can foreclose your property. 

Pre-approval vs. Pre-qualification


Pre-approval confirms how much you are able to borrow. Your income and asset documents are put through a formal review. Once you get pre-approved, you can choose which house you want to purchase. If you are not able to get pre-approved, the adviser can assist you with helpful tips on how you can get approved. 


Pre-qualification is a mortgage advisor’s estimate of the ability to purchase a home. This is based on your credit score and self-reported information. Pre-qualification can give you an idea of which loan program suits you best and how much you can qualify for. 

Choosing a Home That Will Be a Great Investment

There are a couple of ways you can ensure your purchase of a home can increase in value. When looking for areas to buy a house, ask the real estate agent to show you historical comps in that specific area. With this information, you can see how similar houses have increased in value over the years. Another factor to consider is the location. A home that’s near grocery stores, schools, shops, etc., can be a great way to know if your home’s value will increase. 

For Home Loans, Check Us Out!

With the assistance of Anew Lending in Sacramento, CA, they will help you through the entire home-buying process. Our team can help you in many different languages, such as English, Chinese, Spanish, and Vietnamese. You can feel confident as a new home buyer that the process of purchasing a home can be a smooth ride. To learn more about our team, visit Anew Lending today!

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